Transitional tax recovery after repeal: prior valid demand, no fresh notice needed, and recovery may continue through a competent officer.

Recovery under the Income-tax Act, 1961 is discussed in the context of assessments and demands originally made under the Indian Income-tax Act, 1922. The text states that a fresh notice of demand under section 156 of the 1961 Act was unnecessary where valid default had already arisen under the earlier notice, and that the transitional saving provision allowed recovery of sums payable under the repealed Act. It further notes that recovery could continue through a Tax Recovery Officer with concurrent jurisdiction, even if appointed after the certificates were forwarded. The limitation objection was not sustained, and the writ petitions are described as having failed.

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Issues: (i) Whether recovery certificates issued under the Income-tax Act, 1961 were invalid because they were not preceded by fresh notices of demand under section 156 of that Act when the assessments and original demands had been made under the Indian Income-tax Act, 1922. (ii) Whether the recovery proceedings were invalid because the Tax Recovery Officer who proceeded with the recovery was appointed after the certificates had been forwarded. (iii) Whether the recovery was barred by limitation in the two writ petitions where that plea was pressed.

Issue (i): Whether recovery certificates issued under the Income-tax Act, 1961 were invalid because they were not preceded by fresh notices of demand under section 156 of that Act when the assessments and original demands had been made under the Indian Income-tax Act, 1922.

Analysis: Assessments under the 1922 Act were validly continued by the saving and transitional provisions of the 1961 Act. The assessees were already in default because they had failed to comply with the notices of demand issued under section 29 of the 1922 Act. The Court held that section 297(2)(j) permitted recovery of sums payable under the repealed Act under the new Act, and that the power under section 222(1) was attracted once default under the earlier valid demand had occurred. A further notice under section 156 of the 1961 Act was unnecessary and would be merely repetitive.

Conclusion: The absence of a fresh notice under section 156 did not invalidate the recovery certificates, and this contention failed against the assessees.

Issue (ii): Whether the recovery proceedings were invalid because the Tax Recovery Officer who proceeded with the recovery was appointed after the certificates had been forwarded.

Analysis: The statutory definition of Tax Recovery Officer included more than one category of officer, and the power to recover under section 222 read with section 2(44) was treated as a concurrent power capable of being exercised by the officers functioning within the area. The Court rejected the narrow contention that only the officer who was in office when the certificate was forwarded could continue the recovery.

Conclusion: The later-appointed Tax Recovery Officer was competent to continue the recovery proceedings, and this contention also failed against the assessees.

Issue (iii): Whether the recovery was barred by limitation in the two writ petitions where that plea was pressed.

Analysis: The factual foundation for the limitation plea disappeared when the certificate dates were shown to have been misstated or corrected, and the point was not pressed further.

Conclusion: No limitation bar was upheld.

Final Conclusion: The recovery proceedings were held valid in law, and the writ petitions failed in their entirety.

Ratio Decidendi: Where a valid notice of demand issued under the repealed tax law has already placed the assessee in default, the transitional provision permitting recovery under the new Act authorises a recovery certificate without a fresh notice under the new Act, and the recovery may be continued by any competent Tax Recovery Officer having concurrent jurisdiction.

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